Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 189404

December 11, 2013

WILGEN LOON, JERRY ARCILLA, ALBERTPEREYE, ARNOLD

PEREYE, EDGARDO OBOSE, ARNEL MALARAS, PATROCINO
TOETIN, EVELYN LEONARDO, ELMER GLOCENDA, RUFO
CUNAMAY, ROLANDOSAJOL, ROLANDO ABUCAYON,
JENNIFER NATIVIDAD, MARITESS TORION, ARMANDO
LONZAGA, RIZAL GELLIDO, EVIRDE HAQUE, MYRNA VINAS,
RODELITO AYALA, WINELITO OJEL, RENATO RODREGO, NENA
ABINA, EMALYN OLIVEROS, LOUIE ILAGAN, JOEL ENTIG,
ARNEL ARANETA, BENJAMIN COSE, WELITO LOON and
WILLIAM ALIPAO, Petitioners,
vs.
POWER MASTER, INC., TRI-C GENERAL SERVICES, and
SPOUSES HOMER and CARINA ALUMISIN,Respondents.
1

DECISION
BRION, J.:
We resolve the petition for review on certiorari, filed by petitioners
Wilgen Loon, Jerry Arcilla, Albert Pereye, Arnold Pereye, Edgardo
Obose, Arnel Malaras, Patrocino Toetin, Evelyn Leonardo, Elmer
Glocenda, Rufo Cunamay, Rolando Sajol, Rolando Abucayon,
Jennifer Natividad, Maritess Torion, Armando Lonzaga, Rizal Gellido,
Evirde Haque, Myrna Vinas, Rodelito Ayala, Winelito Ojel, Renato
Rodrego, Nena Abina, Emalyn Oliveros, Louie Ilagan, Joel Entig,
Arnel Araneta, Benjamin Cose, Welito Loon, William Alipao
(collectively, the petitioners), to challenge the June 5, 2009
decision and the August 28, 2009 resolution of the Court of
Appeals (CA) in CA-G.R. SP No. 95182.
2

The Factual Antecedents

Respondents Power Master, Inc. and Tri-C General Services

employed and assigned the petitioners as janitors and leadsmen in
various Philippine Long Distance Telephone Company (PLDT) offices
in Metro Manila area. Subsequently, the petitioners filed a complaint
for money claims against Power Master, Inc., Tri-C General Services
and their officers, the spouses Homer and Carina Alumisin
(collectively, the respondents). The petitioners alleged in their
complaint that they were not paid minimum wages, overtime, holiday,
premium, service incentive leave, and thirteenth month pays. They
further averred that the respondents made them sign blank payroll
sheets. On June 11, 2001, the petitioners amended their complaint
and included illegal dismissal as their cause of action. They claimed
that the respondents relieved them from service in retaliation for the
filing of their original complaint.
Notably, the respondents did not participate in the proceedings before
the Labor Arbiter except on April 19, 2001 and May 21, 2001 when
Mr. Romulo Pacia, Jr. appeared on the respondents behalf. The
respondents counsel also appeared in a preliminary mandatory
conference on July 5, 2001. However, the respondents neither filed
any position paper nor proffered pieces of evidence in their defense
despite their knowledge of the pendency of the case.
5

The Labor Arbiters Ruling

In a decision dated March 15, 2002, Labor Arbiter (LA) Elias H.
Salinas partially ruled in favor of the petitioners. The LA awarded the
petitioners salary differential, service incentive leave, and
thirteenth month pays. In awarding these claims, the LA stated that
the burden of proving the payment of these money claims rests with
the employer. The LA also awarded attorneys fees in favor of the
petitioners, pursuant to Article 111 of the Labor Code.
7

However, the LA denied the petitioners claims for backwages,

overtime, holiday, and premium pays. The LA observed that the
petitioners failed to show that they rendered overtime work and
worked on holidays and rest days without compensation. The LA
further concluded that the petitioners cannot be declared to have
been dismissed from employment because they did not show any

notice of termination of employment. They were also not barred from

entering the respondents premises.
The Proceedings before the NLRC
Both parties appealed the LAs ruling with the National Labor
Relations Commission. The petitioners disputed the LAs denial of
their claim for backwages, overtime, holiday and premium pays.
Meanwhile, the respondents questioned the LAs ruling on the ground
that the LA did not acquire jurisdiction over their persons.
The respondents insisted that they were not personally served with
summons and other processes. They also claimed that they paid the
petitioners minimum wages, service incentive leave and thirteenth
month pays. As proofs, they attached photocopied and
computerized copies of payroll sheets to their memorandum on
appeal. They further maintained that the petitioners were validly
dismissed. They argued that the petitioners repeated defiance to
their transfer to different workplaces and their violations of the
company rules and regulations constituted serious misconduct and
willful disobedience.
9

10

On January 3, 2003, the respondents filed an unverified supplemental

appeal. They attached photocopied and computerized copies of
list of employees with automated teller machine (ATM) cards to
the supplemental appeal. This list also showed the amounts
allegedly deposited in the employees ATM cards. They also
attached documentary evidence showing that the petitioners
were dismissed for cause and had been accorded due process.
11

On January 22, 2003, the petitioners filed an Urgent Manifestation

and Motion where they asked for the deletion of the supplemental
appeal from the records because it allegedly suffered from
infirmities. First, the supplemental appeal was not verified. Second, it
was belatedly filed six months from the filing of the respondents
notice of appeal with memorandum on appeal. The petitioners
pointed out that they only agreed to the respondents filing of a
responsive pleading until December 18, 2002. Third the attached
documentary evidence on the supplemental appeal bore the
petitioners forged signatures.
12

13

They reiterated these allegations in an Urgent Motion to Resolve

Manifestation and Motion (To Expunge from the Records
Respondents Supplemental Appeal, Reply and/or
Rejoinder) dated January 31, 2003. Subsequently, the petitioners
filed an Urgent Manifestation with Reiterating Motion to Strike-Off
the Record Supplemental Appeal/Reply, Quitclaims and
Spurious Documents Attached to Respondents Appeal dated
August 7, 2003. The petitioners argued in this last motion that the
payrolls should not be given probative value because they were the
respondents fabrications. They reiterated that the genuine payrolls
bore their signatures, unlike the respondents photocopies of the
payrolls. They also maintained that their signatures in the
respondents documents (which showed their receipt of thirteenth
month pay) had been forged.
14

15

The NLRC Ruling

In a resolution dated November 27, 2003, the NLRC partially ruled in
favor of the respondents. The NLRC affirmed the LAs awards
of holiday pay and attorneys fees. It also maintained that the LA
acquired jurisdiction over the persons of the respondents through
their voluntary appearance.
16

However, it allowed the respondents to submit pieces of

evidence for the first time on appeal on the ground that they had
been deprived of due process. It found that the respondents did not
actually receive the LAs processes. It also admitted the respondents
unverified supplemental appeal on the ground that technicalities may
be disregarded to serve the greater interest of substantial due
process. Furthermore, the Rules of Court do not require the
verification of a supplemental pleading.
The NLRC also vacated the LAs awards of salary differential,
thirteenth month and service incentive leave pays. In so ruling, it
gave weight to the pieces of evidence attached to the memorandum
on appeal and the supplemental appeal. It maintained that the
absence of the petitioners signatures in the payrolls was not an
indispensable factor for their authenticity. It pointed out that the
payment of money claims was further evidenced by the list of
employees with ATM cards. It also found that the petitioners

signatures were not forged. It took judicial notice that many people
use at least two or more different signatures.
The NLRC further ruled that the petitioners were lawfully dismissed
on grounds of serious misconduct and willful disobedience. It
found that the petitioners failed to comply with various memoranda
directing them to transfer to other workplaces and to attend training
seminars for the intended reorganization and reshuffling.
The NLRC denied the petitioners motion for reconsideration in a
resolution dated April 28, 2006. Aggrieved, the petitioners filed a
petition for certiorari under Rule 65 of the Rules of Court before the
CA.
17

18

The CA Ruling
The CA affirmed the NLRCs ruling. The CA held that the petitioners
were afforded substantive and procedural due process. Accordingly,
the petitioners deliberately did not explain their side. Instead, they
continuously resisted their transfer to other PLDT offices and violated
company rules and regulations. It also upheld the NLRCs findings on
the petitioners monetary claims.
The CA denied the petitioners motion for reconsideration in a
resolution dated August 28, 2009, prompting the petitioners to file the
present petition.
19

The Petition
In the petition before this Court, the petitioners argue that the CA
committed a reversible error when it did not find that the NLRC
committed grave abuse of discretion. They reiterate their arguments
before the lower tribunals and the CA in support of this conclusion.
They also point out that the respondents posted a bond from a surety
that was not accredited by this Court and by the NLRC. In effect, the
respondents failed to perfect their appeal before the NLRC. They
further insist that the NLRC should not have admitted the
respondents unverified supplemental appeal.
20

The Respondents Position

In their Comments, the respondents stress that the petitioners only

raised the issue of the validity of the appeal bond for the first time on
appeal. They also reiterate their arguments before the NLRC and the
CA. They additionally submit that the petitioners arguments have
been fully passed upon and found unmeritorious by the NLRC and
the CA.
21

The Issues
This case presents to us the following issues:
1) Whether the CA erred when it did not find that the NLRC
committed grave abuse of discretion in giving due course to the
respondents appeal;
a) Whether the respondents perfected their appeal before
the NLRC; and
b) Whether the NLRC properly allowed the respondents
supplemental appeal
2) Whether the respondents were estopped from submitting
pieces of evidence for the first time on appeal;
3) Whether the petitioners were illegally dismissed and are thus
entitled to backwages;
4) Whether the petitioners are entitled to salary differential,
overtime, holiday, premium, service incentive leave, and
thirteenth month pays; and
5) Whether the petitioners are entitled to attorneys fees.
The Courts Ruling
The respondents perfected their
appeal with the NLRC because the
revocation of the bonding company's
authority has a prospective
application

Paragraph 2, Article 223 of the Labor Code provides that "[i]n case of
a judgment involving a monetary award, an appeal by the employer
may be perfected only upon the posting of a cash or surety bond
issued by a reputable bonding company duly accredited by the
Commission in the amount equivalent to the monetary award in the
judgment appealed from."
Contrary to the respondents claim, the issue of the appeal bonds
validity may be raised for the first time on appeal since its proper filing
is a jurisdictional requirement. The requirement that the appeal bond
should be issued by an accredited bonding company is mandatory
and jurisdictional. The rationale of requiring an appeal bond is to
discourage the employers from using an appeal to delay or evade the
employees' just and lawful claims. It is intended to assure the workers
that they will receive the money judgment in their favor upon the
dismissal of the employers appeal.
22

23

In the present case, the respondents filed a surety bond issued by

Security Pacific Assurance Corporation(Security Pacific) on June 28,
2002. At that time, Security Pacific was still an accredited bonding
company. However, the NLRC revoked its accreditation on February
16, 2003. Nonetheless, this subsequent revocation should not
prejudice the respondents who relied on its then subsisting
accreditation in good faith. In Del Rosario v. Philippine Journalists,
Inc., we ruled that a bonding companys revocation of authority is
prospective in application.
24

25

However, the respondents should post a new bond issued by an

accredited bonding company in compliance with paragraph 4, Section
6, Rule 6 of the NLRC Rules of Procedure. This provision states that
"[a] cash or surety bond shall be valid and effective from the date of
deposit or posting, until the case is finally decided, resolved or
terminated or the award satisfied."
The CA correctly ruled that the
NLRC properly gave due course to
the respondents supplemental
appeal

The CA also correctly ruled that the NLRC properly gave due course
to the respondents supplemental appeal. Neither the laws nor the
rules require the verification of the supplemental
appeal. Furthermore, verification is a formal, not a jurisdictional,
requirement. It is mainly intended for the assurance that the matters
alleged in the pleading are true and correct and not of mere
speculation. Also, a supplemental appeal is merely an addendum to
the verified memorandum on appeal that was earlier filed in the
present case; hence, the requirement for verification has substantially
been complied with.
26

27

The respondents also timely filed their supplemental appeal on

January 3, 2003. The records of the case show that the petitioners
themselves agreed that the pleading shall be filed until December 18,
2002. The NLRC further extended the filing of the supplemental
pleading until January 3, 2003 upon the respondents motion for
extension.
A party may only adduce evidence
for the first time on appeal if he
adequately explains his delay in the
submission of evidence and he
sufficiently proves the allegations
sought to be proven
In labor cases, strict adherence to the technical rules of procedure is
not required. Time and again, we have allowed evidence to be
submitted for the first time on appeal with the NLRC in the interest of
substantial justice. Thus, we have consistently supported the rule
that labor officials should use all reasonable means to ascertain the
facts in each case speedily and objectively, without regard to
technicalities of law or procedure, in the interest of due process.
28

29

However, this liberal policy should still be subject to rules of reason

and fairplay. The liberality of procedural rules is qualified by two
requirements: (1) a party should adequately explain any delay in
the submission of evidence; and (2) a party should sufficiently
prove the allegations sought to be proven. The reason for these
requirements is that the liberal application of the rules before quasijudicial agencies cannot be used to perpetuate injustice and hamper
30

the just resolution of the case. Neither is the rule on liberal

construction a license to disregard the rules of procedure.

31

Guided by these principles, the CA grossly erred in ruling that the

NLRC did not commit grave abuse of discretion in arbitrarily admitting
and giving weight to the respondents pieces of evidence for the first
time on appeal.
A. The respondents failed to
adequately explain their delay
in the submission of evidence
We cannot accept the respondents cavalier attitude in blatantly
disregarding the NLRC Rules of Procedure. The CA gravely erred
when it overlooked that the NLRC blindly admitted and arbitrarily
gave probative value to the respondents evidence despite their
failure to adequately explain their delay in the submission of
evidence. Notably, the respondents delay was anchored on their
assertion that they were oblivious of the proceedings before the LA.
However, the respondents did not dispute the LAs finding that Mr.
Romulo Pacia, Jr. appeared on their behalf on April 19, 2001 and May
21, 2001. The respondents also failed to contest the petitioners
assertion that the respondents counsel appeared in a preliminary
mandatory conference on July 5, 2001.
32

33

Indeed, the NLRC capriciously and whimsically admitted and gave

weight to the respondents evidence despite its finding that they
voluntarily appeared in the compulsory arbitration proceedings. The
NLRC blatantly disregarded the fact that the respondents voluntarily
opted not to participate, to adduce evidence in their defense and to
file a position paper despite their knowledge of the pendency of the
proceedings before the LA. The respondents were also grossly
negligent in not informing the LA of the specific building unit where
the respondents were conducting their business and their counsels
address despite their knowledge of their non-receipt of the
processes.
34

B. The respondents failed to

sufficiently prove the

allegations sought to be
proven
Furthermore, the respondents failed to sufficiently prove the
allegations sought to be proven. Why the respondents photocopied
and computerized copies of documentary evidence were not
presented at the earliest opportunity is a serious question that lends
credence to the petitioners claim that the respondents fabricated the
evidence for purposes of appeal. While we generally admit in
evidence and give probative value to photocopied documents in
administrative proceedings, allegations of forgery and
fabrication should prompt the adverse party to present the
original documents for inspection. It was incumbent upon the
respondents to present the originals, especially in this case where the
petitioners had submitted their specimen signatures. Instead, the
respondents effectively deprived the petitioners of the opportunity to
examine and controvert the alleged spurious evidence by not
adducing the originals. This Court is thus left with no option but to rule
that the respondents failure to present the originals raises the
presumption that evidence willfully suppressed would be adverse if
produced.
35

36

It was also gross error for the CA to affirm the NLRCs proposition
that "[i]t is of common knowledge that there are many people who
use at least two or more different signatures." The NLRC cannot
take judicial notice that many people use at least two signatures,
especially in this case where the petitioners themselves disown the
signatures in the respondents assailed documentary evidence. The
NLRCs position is unwarranted and is patently unsupported by the
law and jurisprudence.
37

38

Viewed in these lights, the scales of justice must tilt in favor of the
employees. This conclusion is consistent with the rule that the
employers cause can only succeed on the strength of its own
evidence and not on the weakness of the employees evidence.
39

The petitioners are entitled to

backwages

Based on the above considerations, we reverse the NLRC and the

CAs finding that the petitioners were terminated for just cause and
were afforded procedural due process. In termination cases, the
burden of proving just and valid cause for dismissing an employee
from his employment rests upon the employer. The employers failure
to discharge this burden results in the finding that the dismissal is
unjustified. This is exactly what happened in the present case.
40

The petitioners are entitled to salary

differential, service incentive,
holiday, and thirteenth month pays
We also reverse the NLRC and the CAs finding that the petitioners
are not entitled to salary differential, service incentive, holiday, and
thirteenth month pays. As in illegal dismissal cases, the general rule
is that the burden rests on the defendant to prove payment rather
than on the plaintiff to prove non-payment of these money
claims. The rationale for this rule is that the pertinent personnel files,
payrolls, records, remittances and other similar documents which
will show that differentials, service incentive leave and other claims of
workers have been paid are not in the possession of the worker but
are in the custody and control of the employer.
41

42

The petitioners are not entitled to

overtime and premium pays
However, the CA was correct in its finding that the petitioners failed to
provide sufficient factual basis for the award of overtime, and
premium pays for holidays and rest days. The burden of proving
entitlement to overtime pay and premium pay for holidays and rest
days rests on the employee because these are not incurred in the
normal course of business. In the present case, the petitioners failed
to adduce any evidence that would show that they actually rendered
service in excess of the regular eight working hours a day, and that
they in fact worked on holidays and rest days.
43

The petitioners are entitled to

attorneys fees
The award of attorneys fees is also warranted under the
circumstances of this case. An employee is entitled to an award of
1wphi1

attorneys fees equivalent to ten percent (10%) of the amount of the

wages in actions for unlawful withholding of wages.
44

As a final note, we observe that Rodelito Ayala, Winelito Ojel, Renato

Rodrego and Welito Loon are also named as petitioners in this case.
However, we deny their petition for the reason that they were not part
of the proceedings before the CA. Their failure to timely seek redress
before the CA precludes this Court from awarding them monetary
claims.
All told, we find that the NLRC committed grave abuse of discretion in
admitting and giving probative value to the respondents' evidence on
appeal, which errors the CA replicated when it upheld the NLRC
rulings.
WHEREFORE, based on these premises, we REVERSE and SET
ASIDE the decision dated June 5, 2009, and the resolution dated
August 28, 2009 of the Court of Appeals in CA-G.R. SP No. 95182.
This case is REMANDED to the Labor Arbiter for the sole purpose of
computing petitioners' (Wilgen Loon, Jerry Arcilla, Albert Pereye,
Arnold Pereye, Edgardo Obose, Arnel Malaras, Patrocino Toetin,
Evelyn Leonardo, Elmer Glocenda, Rufo Cunamay, Rolando Sajol,
Rolando Abucayon, Jennifer Natividad, Maritess Torion, Ammndo
Lonzaga, Rizal Gellido, Evirdly Haque, Myrna Vinas, Nena Abina,
Emalyn Oliveros, Louie Ilagan, Joel Entig, Amel Araneta, Benjamin
Cose and William Alipao) full backwages (computed from the date of
their respective dismissals up to the finality of this decision) and their
salary differential, service incentive leave, holiday, thirteenth month
pays, and attorney's fees equivalent to ten percent (10%) of the
withheld wages. The respondents are further directed to immediately
post a satisfactory bond conditioned on the satisfaction of the awards
affirmed in this Decision